Monday, December 17, 2007

Q&A with Prison Health Services, Inc.

Company officials would not agree to a telephone interview, but Martha Harbin, PHS's liaison for Florida, responded to the following questions by e-mail.

Almost all news stories involving PHS are negative. Why do you think that is? And what positive stories are the media not writing about?

"It's important to keep in mind that we care for patients who are much sicker and have had much less access to health care than the general population. We are treating a major public health need in Ocala and all of the other communities across the country served by PHS.

"We hear from many former patients and their families who thank us for the care they received while incarcerated. For many, it is the first health care they have received in their adult lifetime. However, patient privacy laws and policies prevent us from sharing their stories with the media.

"We strive to inform the media when we have positive developments such as one of our client jails achieving accreditation from the American Correctional Association or the National Commission on Correctional Health Care at rates substantially higher than non-contracted facilities. Those achievements generally don't attract the attention of the media to nearly the same degree as sensational allegations against the company and corrections in general."

Do you think for a health care provider your size, the number of lawsuits is unusually high, or is it comparable to any other large private health care provider?
"The practice of medicine today is fraught with exposure to lawsuits, but correctional health care cannot be compared to non-correctional health care. We care for patients who are much sicker and have had much less access to health care than the general population with substance abuse rates far higher than the general population.

"We can tell you that over the course of a year, PHS cares for approximately a half a million patients through a conservative estimate of several million patient encounters, yet our rate of lawsuits is 50 percent less than the national average of all correctional health care providers. (Based on 2005 internal litigation statistics and "Prisoner Petitions Filed in U.S. District Courts, 2000, with Trends 1980-2000." Bureau of Justice Statistics, January 2002, available through the U.S. Department of Justice.)"

What are the major challenges of providing medical care at a jail? Is correctional health care comparable to health care outside the correctional institutions?
"The inmate population is much less healthy, with higher rates of chronic diseases like HIV/AIDS, diabetes and alcoholism and other substance addiction, not to mention the high percentage of mentally ill patients who are incarcerated.

"Inmates are also the only people in the United State with a Constitutional requirement to be provided with access to a community-based standard of health care."

How do you explain frequent allegations made by inmates that they are routinely denied legally-prescribed medications by PHS medical staff?
"Patients are not permitted to bring outside medications into the jail for health, safety and security reasons, which is common practice for most, if not all, correctional and non-correction health care facilities.

"We work quickly to verify a patient's prescriptions and once verified, continue to administer that prescription. For patients with life-threatening conditions, such as insulin-dependent diabetes, we continue providing the medication based upon the patient's report and do not wait for confirmation from the patient's outside medical provider. It is in everyone's interest that appropriate medications are provided on a timely and consistent basis since failure to do so may result in a deterioration of the patient's condition and the need for intensive and costly treatment."

Do you think there is adequate oversight regarding the medical care PHS provides in jails? What oversight is PHS subject to and does it vary by jail?
"PHS is subject to extensive contract monitoring, oversight and accountability requirements in all of our contracts. These measures vary by contract [but] may include staffing, operations, and clinical measures of performance as well as compliance with national and state accrediting agencies. For example, in Florida, the Florida Model Jail Standards impose extensive requirements that PHS has a history of meeting on a consistent basis."

Does the company have a high turnover rate among doctor and nursing staff? Is it difficult to recruit staff?
"On the contrary, we have a comparatively low turnover rate for the medical field. With the increased paperwork and approval demands imposed by managed care, it is increasingly easier to recruit extremely talented staff who desire to practice 'real' medicine as opposed to the fiscal constraints of managed care. In addition, our doctors are staff, as opposed to contractors, and in addition to a number of benefits, we provide medical malpractice insurance, which is very attractive to many doctors who find it increasingly difficult to operate a profitable private practice."

Can you give us an estimate of dollars the company spends on defending or settling lawsuits? Are lawsuits a big concern for the company?
"A greater concern for the company is holding down the amount we have to pay in medical malpractice insurance, which is one reason - in addition to the moral and ethical reasons - why PHS insists on providing the most appropriate care to our patients. PHS has refused to accept contracts in which we believed that the client had budgeted too little to provide adequate care."

Critics have said that private companies like PHS boost profits by "cutting corners" and providing less-than-adequate care to inmates. How do you respond?
"That's not true. Like all health care providers, including public and private hospital systems, PHS consistently works to improve efficiencies and manage costs to be good stewards of taxpayer dollars. However, providing less-than-adequate care would expose us to increased malpractice awards. We cannot control how many patients file suit but we can control our exposure to malpractice awards by providing health care that matches the community standard of care.

"Also, PHS is a subsidiary of ASGR, a publicly traded company. Unlike privately owned and non-profit health care providers, our executive compensation and corporate performance is available to the public through our SEC filings."

Prison Health Services, Inc. was established in 1978 in Delaware.

Today, it is a wholly-owned subsidiary of Brentwood, Tennessee-based America Service Group, Inc.

ASGR reported $6.8 million in net income for 2007 and an estimated $550 million in total revenue.

Today, the company is one of the largest private providers of correctional health care in the nation, serving 14 percent of outsourced correctional health care. The company served 23 percent of the outsourced market in 2005.

PHS has more than 4,700 employees at 69 institutions - city and county jails, and state prisons - covering close to 165,000 inmates.

Florida, where PHS has contracts with 23 correctional facilities, is PHS's third largest market. It serves 35 facilities in Pennsylvania and 32 in Alabama.


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